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SAS lowers bar as profits descend

A bad year as Scandinavian Airlines is forced to downgrade expectations


Red figures at SAS force the airline to make cutbacks (Photo: Scanpix)

May 8, 2014
14:29

by AJ


After posting a first quarter loss, Scandinavian Airlines (SAS) is now under so much pressure that the board has decided to turn down the expectations a notch, Børsen reports.

Too much competition has made it impossible for the airline to reach the goal it set at the start of the year, and it has been forced to lower its worst-case forecasts.

Taking aggressive course
"Increased competition for the customers means SAS will be more aggressive," the head of SAS, Rickard Gustafson, told Børsen.

"We have improved our offer to Scandinavia's commuters, intensified marketing and therefore have more customers combined with a larger load factor."

Budget cutbacks are expected to generate positive results for the airline, including the positive effects that recent changes to employee's pensions will bring. Previous estimates expected positive results without including the pension changes, but the board now finds that prospect too ambitious.

More passengers
However, the downgrading coincides with rising revenue passenger kilometre figures, which rose by 13.7 percent in April compared to the same month last year.

SAS carried 2.4 million passengers in April – 9.2 percent more than last year.



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